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How to benefit
There are multiple ways to incorporate leasing into your business strategy. First, you can become a referral source for a leasing company or lease broker. Basically, you find prospects -- perhaps your current customers -- who need equipment and turn over the leads. The lease people do all the work and you get a fee for deals that close.
Being a referral source requires minimal work or education, but the fees are small -- 1 percent or 2 percent of the equipment cost -- and you have no control over the process.
You can also become a sales representative for a leasing company or lease broker. The company will teach you the basics, provide sales support and typically pay you a 2-percent to 5-percent commission on closed deals.
Getting to more-serious options, you can become an independent equipment-lease broker. There are usually no licensing requirements, but comprehensive training is a must because you're out on your own.
There are several lease-broker training courses available, some with ongoing support built in. Your investment in these courses will range from a few-thousand dollars to much more. But there's no limitation on profits, and fees can run to 10 percent or even 15 percent of equipment cost.
You could also become part of a franchise-like business. These programs usually offer licensed use of the parent company's name, giving your business immediate credibility. For example, a company named The Best Leasing might allow you to use The Best Leasing of Montana.
The parent company usually offers marketing tools, training and back-end support, including credit investigation and syndication of deals with funding sources.
Using an established name cuts administrative costs, but the initial investment is generally between $15,000 and $35,000. The contract term commitment usually lasts a year or more.
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Be sure to check out potential leasing alliances in advance. Most leasing companies and lease brokers will offer you multiple opportunities. Pick businesses you trust and make sure they are willing to invest time in teaching you the business.
Ken Goodman, a certified lease professional (CLP), has
more than 35 years' experience in equipment leasing as a marketing executive, CEO, consultant, author, speaker and educator. He is managing partner of Lake Forest, Calif.-based Goodman & Associates, which provides consulting and training services for equipment-finance companies and lease brokers. He also manages the Podium Partners program for Podium Financial Group, which offers education and support to lease brokers. Reach him at (888) 852-7560 or email@example.com.
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